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Automated Debt-Collection Lawsuits Engulf Courts

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The New York Times reports:

"As millions of Americans have fallen behind on paying their bills, debt collection law firms have been clogging courtrooms with lawsuits seeking repayment.

Few have been as prolific as Cohen & Slamowitz, a Woodbury, N.Y., firm that has specialized in debt collection for nearly two decades. The firm has been filing roughly 80,000 lawsuits a year.

With just 14 lawyers on staff, that works out to more than 5,700 cases per lawyer.

How is that possible?'"

The article goes on to explain that:

"Collection law firms are able to handle such large volumes of cases because computer software automates much of their work. Typically, a debt buyer sends a law firm an electronic database that contains various data about consumers, including name, home address, the outstanding balance, the date of default and whether interest is still accruing on the account.

Once the data is obtained by a law firm, software like Collection-Master from a company called Commercial Legal Software can “take a file and run it through the entire legal system automatically,” including sending out collection letters, summonses and lawsuits, said Nicholas D. Arcaro, vice president for sales and marketing at the company."

According to Schlanger & Schlanger, a New York consumer protection law firm, Cohen & Slamowitz "has been sued repeatedly by New York consumers for its unfair and deceptive debt collection practices."

An example cited:

"Schlanger and Schlanger, LLP recently brought lawsuit against Cohen & Slamowitz under the Fair Debt Collection Practices Act (FDCPA) for debt collection abuse. Specifically, we sued Cohen & Slamowitz for harassing a consumer regarding a debt she had already settled in full. Cohen and Slamowtiz unsuccessfully attempted to have our case dismissed. Federal Judge Colleen McMahon denied the motion, described Cohen & Slamowitz’s arguments as “idiotic” and sanctioned Cohen & Slamowitz for the “utter frivolousness” of its motion."

An FTC report released yesterday found that "debt collection litigation raised concerns about collectors failing to properly notify consumers of suits they have filed, collectors filing suits based on insufficient evidence of indebtedness, courts frequently granting default judgments against consumers who do not appear or defend themselves, collectors seeking to recover on debts beyond the statute of limitations, and banks freezing funds in bank accounts that are exempt from garnishment by law."


I just can't get over the fact that there's a lawyer named Slamowitz. Slamowitz!

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